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October 31, 2018

Commonwealth Bank to sell asset management business to Mitsubishi for $2.9bn

Commonwealth Bank of Australia (CBA) has agreed to divest its global asset management arm Colonial First State Global Asset Management (CFSGAM) to Japan’s Mitsubishi UFJ Trust and Banking (MUTB) in a deal worth A$4.13bn ($2.9bn).

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  • The report provides an analysis of factors driving liquid asset growth. It is also split into asset classes - equities, mutual funds, deposits, and bonds.
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The latest deal implies that CFSGAM will be excluded from plan to demerge CBA’s wealth management and mortgage broking businesses, which was announced in June this year.

Called First State Investments outside of Australia, CFSGAM managed around $213bn in assets at the end of June 2018. The business has offices in the US, Europe, and Asia-Pacific.

CBA expects to book a gain of nearly $1.5bn from the deal after tax. The deal is expected to be wrapped up in mid-2019, subject to regulatory approval.

CBA CEO Matt Comyn said: “Today’s announcement represents another important milestone in CBA’s strategy to focus on its core banking businesses and to create a simpler, better bank.

“The sale of CFSGAM to MUTB represents significant value for CBA shareholders and is a positive outcome for CFSGAM clients and employees.”

MUTB president and CEO Mikio Ikegaya added: “We expect CFSGAM will continue to deliver leading investment solutions to its existing global client base. We also believe CFSGAM’s highly seasoned investment teams and competitive product line-ups will enable us to deliver new investment opportunities to our clients.”

Meanwhile, CBA named Jason Yetton as the CEO and Andrew Morgan as the CFO of its demerged wealth management and mortgage broking business dubbed NewCo. The pair will assume their new responsibilities on 1 December 2018.

NewCo includes Colonial First State, Count Financial, Financial Wisdom, Aussie Home Loans as well as CBA’s minority stakes in CountPlus and MortgageChoice.

Yettonmost recently served at the CEO and managing director of SocietyOne. Previously, he also had stints at Westpac and BT Financial Group.

Morgan currently serves as the CFO of wealth management at CBA. He formerly worked at Lend Lease, National Australia Bank, Radian and Perpetual.

Free Report
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Analyze opportunies within the wealth management market in APAC

GlobalData’s ‘Asia-Pacific Wealth Management: Market Sizing and Opportunities to 2026’ report provides a comprehensive overview of the Asia-Pacific (APAC) wealth management market.
  • The report analyzes the APAC wealth and retail savings and investments markets. This includes affluent market size, both by number of individuals and the value of their liquid assets.
  • The affluent population grew by 5.3% in 2021 and is expected to grow at an AAGR of 4.8% between 2022 and 2026.
  • The value of liquid assets held by the affluent segment surged by 8.4% in 2021, backed by economic recovery. HNW individuals’ financial wealth grew by 12%, while mass affluent individuals’ wealth grew by 6.0%.
  • The report provides an analysis of factors driving liquid asset growth. It is also split into asset classes - equities, mutual funds, deposits, and bonds.
  • The affluent population are more risk-tolerant and invest a significant proportion of their investments in risky assets such as equities, compared to emerging affluent and mass market individuals.
The report also provides data and insights on the size of offshore holding of HNW investors in the APAC region.
by GlobalData
Enter your details here to receive your free Report.

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